Inheritance Tax and the Surviving Child's Share in Belgium

The Short Answer

The surviving child's share is a special inheritance right in Belgium whereby one child (usually the surviving occupant or carer) can retain the family home under certain conditions.

In brief:

• The family home does NOT go to all children equally (standard inheritance)
• One child can keep the house and buy out the others
• This child receives advantages (lower inheritance tax, deferred payment)
• But it is complex - many conditions apply

This guide explains how it works, what the benefits are, how to reduce inheritance tax, and what you need to plan for.

1. What Is the Surviving Child's Share?

The Concept:

The surviving child's share = a special inheritance right allowing one child to keep the family home rather than selling it and dividing the proceeds.

Standard Inheritance (WITHOUT the surviving child's share):

Parent Dies Leaving 2 Children:

• House worth €300,000
• Child 1 inherits: €150,000
• Child 2 inherits: €150,000

Problem:

• The house must be sold (to divide the estate)
• OR: one child must pay the other €150,000

With the Surviving Child's Share:

Parent Dies Leaving 2 Children:

• House worth €300,000
• Child 1 (surviving occupant): keeps the house (€300,000)
• Child 2: receives €150,000 in cash (or an equivalent share)

Advantage:

• The house does not need to be sold
• The surviving child can continue living there
• Inheritance tax is lower

2. The Conditions - Who Qualifies?

This Is CRUCIAL. Not everyone can use this arrangement!

Condition 1: FIRSTBORN Child (or Surviving Occupant)

This depends on the region:

• Flanders: traditionally the firstborn
• Brussels: the surviving occupant
• Wallonia: traditionally the firstborn
• Variations exist by region!

Check the legislation applicable to your region!

Condition 2: It Must Be the FAMILY HOME

What Is Allowed:

• ✅ The home where the parent lives
• ✅ The parent's only property
• ✅ The family residence

What Is NOT Allowed:

• ❌ A second home or holiday property
• ❌ An investment property
• ❌ Shares or cash (only real estate qualifies)

Condition 3: The Child Must Occupy the Property

The Child Must:

• ✅ Live in the house themselves (as their home)
• ✅ Not rent it out (in some regions)
• ✅ Make it their principal residence

Condition 4: Financial Conditions

Depending on the Region:

• The parent must have owned a minimum percentage of the property
• The child must have resided there for a specified period
• Debts must be settled

3. A Practical Example - How It Works

Scenario: A Family in Flanders

Given:

• Mother passes away
• Mother owned a house worth €300,000 (debt: €0)
• Mother had 2 children
• Child 1 (surviving occupant): has lived in the house for 20 years
• Child 2: lives elsewhere

Standard Inheritance (WITHOUT the Surviving Child's Share):

Problem: the house must be sold OR Child 1 pays €143,250 to Child 2

With the Surviving Child's Share:

Advantage:

• Child 1: keeps the house
• Child 1: can defer payment (kindsloon)
• Child 1: can spread inheritance tax payments
• The house does not need to be sold

4. Inheritance Tax With the Surviving Child's Share - How Does It Work?

This Is Where Things Get More Complicated!

The Calculation Differs by Region

Flanders:

The surviving child's share comes with advantages:

• Lower inheritance tax on the deferred portion
• Possibility of spreading payments
• Low (or zero) interest

Gross inheritance tax: 3% (standard rate)
With deferral (kindsloon): can be lower!

Brussels:

• Inheritance tax on the child's share: 3%-9% (depending on the amount)
• Standard inheritance tax: 3%-9%
• The advantage is less clear-cut

Wallonia:

• Depends on the specific situation
• The surviving child's share can offer advantages
• Interest on deferral is low

Calculation Example (Flanders):

Mother Dies, 2 Children, House Worth €300,000:

With Deferral (Kindsloon):

• Child 1 can defer €9,000 in inheritance tax
• Repayable over 10-20 years
• Low (or zero) interest

This Frees Up Cash!

5. The Kindsloon - How to Defer Payment

This Is One of the Biggest Advantages of the Arrangement!

What Is the Kindsloon?

Kindsloon = the ability to defer inheritance tax and debts and repay them over a number of years.

Conditions:

• ✅ The house must not be sold
• ✅ The child must occupy it themselves
• ✅ Debts must be settled
• ✅ The other heirs must agree (!)

How Long Can You Defer?

Flanders: up to 10-15 years
Brussels: up to 5-10 years
Wallonia: up to 10 years (depending on circumstances)

Interest on Deferral:

Low! Typically:

• 0%-2% interest per year
• This Is MUCH Lower Than a Mortgage!
• This Is MUCH Lower Than a Standard Bank Loan!

Example:

• Inheritance tax: €10,000
• Deferral: 10 years
• Interest: 1%
• Monthly payment: approx. €95/month (very affordable!)

6. How to Apply for the Surviving Child's Share - Practical Steps

Step 1: Consult a Notary

• Say: "My parent has passed away"
• Say: "I want to apply for the surviving child's share"
• The notary will advise whether it is possible

Cost: €0 (initial advice)

Step 2: Gather Documents

• Will (copy)
• Title deeds of the property
• Current property valuation
• Declaration of ownership (any outstanding debts?)
• ID documents of all heirs

Step 3: Negotiate With the Other Heirs

This Is Crucial:

• The other heirs MUST give their consent
• You may keep the house
• They must be bought out
• The kindsloon arrangement must be agreed

Where to Negotiate:

• The notary can assist
• Or through private family discussions

Step 4: File the Inheritance Tax Declaration With the Surviving Child's Share Request

• The notary files the "surviving child's share" request
• The tax authority reviews the file
• A decision is usually reached within 2-4 weeks

Step 5: Draw Up a Repayment Plan

• The notary draws up the repayment plan
• Annual repayments
• Interest rate is fixed
• All parties sign

7. Advantages of the Surviving Child's Share - Why Use It?

Advantage 1: KEEPING THE HOUSE

• ✅ You do not have to sell the house
• ✅ You can carry on living where you live
• ✅ The sentimental value is preserved
• ✅ No stress from the property market

Advantage 2: SAVING MONEY

• ✅ Lower inheritance tax (sometimes)
• ✅ No estate agent commission (no sale)
• ✅ No notary fees from a sale
• ✅ Total potential saving: €20,000-€50,000!

Advantage 3: DEFERRED PAYMENT

• ✅ Inheritance tax can be deferred
• ✅ Low interest (0-2%)
• ✅ Spread over 10-15 years
• ✅ More time to build up savings

Advantage 4: SIMPLER INHERITANCE PROCESS

• ✅ No complicated division of assets
• ✅ The other heir receives cash
• ✅ Simpler administration
• ✅ Fewer family disputes

8. Disadvantages of the Surviving Child's Share - Proceed With Caution!

Disadvantage 1: OTHER HEIRS CAN REFUSE

• ❌ They must give their consent
• ❌ They can make demands
• ❌ Negotiation is required
• ❌ It can get complicated

Disadvantage 2: YOU MUST PAY

• ❌ Inheritance tax must be paid (deferred, but not waived)
• ❌ Debts must be repaid
• ❌ Other heirs must be bought out

You Risk Insolvency If You Cannot Pay!

Disadvantage 3: THE PROPERTY REMAINS ENCUMBERED

• ❌ Taking out a mortgage may not be possible (the property could be seized by the bank!)
• ❌ Debts are secured on the property (inheritance tax)
• ❌ You must repay the debts, not take on a mortgage

Disadvantage 4: FAMILY CONFLICTS

• ❌ Other heirs may feel it is unfair
• ❌ "Why do you get the house?"
• ❌ It can trigger family disputes

9. Practical Scenarios - What Can Go Wrong?

Scenario 1: The Child Cannot Pay

Situation:

• Child keeps the house (surviving child's share)
• Inheritance tax: €15,000 (deferred over 10 years)
• Monthly payment: €125
• Child loses their job

Consequence:

• The child can no longer pay
• The debt can grow (interest)
• The child risks losing the house
• Risk of insolvency

This Is a REAL RISK!

Scenario 2: The Other Heir Claims a Share of the Capital Gain

Situation:

• Child keeps the house (€300,000)
• Other heir receives cash (€150,000)
• 5 years later: the house is worth €400,000
• Other heir: "This is unfair!"

Consequence:

• Dispute over the capital gain
• Legal proceedings
• The house may ultimately have to be sold after all
• A great deal of stress and expense

Scenario 3: The Child Wants to Sell Later

Situation:

• Child keeps the house (surviving child's share)
• 5 years later: the child wants to move
• The child wants to sell the house

Consequence:

• The debt must be repaid immediately (the kindsloon ends)
• The child must pay all outstanding amounts
• This can cause real difficulties

10. Alternatives - Other Options

Option 1: Standard Inheritance (Sell the House)

• The house is sold
• The proceeds are divided
• Everyone receives their share
• The child must find somewhere else to live

Advantage: simple and straightforward
Disadvantage: loss of the house, high costs

Option 2: Buy Out a Sibling's Share

• The house is not subject to the surviving child's share regime
• You pay your sibling their share
• You inherit the house in the normal way
• You need to have the funds available (mortgage?)

Advantage: straightforward
Disadvantage: you need the funds available

Option 3: The House in the Name of All Heirs

• The property is held in undivided co-ownership
• All heirs are co-owners
• Difficulty: who gets to live there?
• Who pays the maintenance costs?

Advantage: shared ownership
Disadvantage: very complicated

11. Smart Planning - How to Make the Most of the Surviving Child's Share

Tip 1: Make Sure There Is a Will

The parent should:

• Draw up a will
• State explicitly: "I want to use the surviving child's share"
• Specify which child (the surviving occupant?)
• Use a notary

This Prevents Complications Later!

Tip 2: Negotiate Early

Do not wait until the death occurs:

• Speak to your siblings now
• "Mum wants to use the surviving child's share"
• Agree on the figures
• No nasty surprises later

Save Yourself a Lot of Stress!

Tip 3: Build Up a Financial Buffer

• Build up savings
• Prepare for the monthly payments
• Fix the interest rate (low!)
• Know what you can afford to pay

Tip 4: Seek Legal Advice

• Consult a notary
• Consult a lawyer (in case of conflict?)
• Cost: €200-€500 for advice
• This Could Save You Thousands Later!

12. Summary: Inheritance Tax and the Surviving Child's Share

Key Points:

1. The Surviving Child's Share = a Special Inheritance Right

• One child keeps the family home
• Other heirs receive cash
• Not everyone qualifies

1. Conditions:

• ✅ Family home (not a second property)
• ✅ The child must occupy the property themselves
• ✅ Other heirs must give their consent
• ✅ Region-specific rules apply

1. Inheritance Tax:

• Can be lower (depending on the region)
• Kindsloon: deferred payment (10-15 years)
• Low interest (0-2%)

1. Advantages:

• ✅ Keep the house
• ✅ Save on costs
• ✅ Defer payment
• ✅ Simpler inheritance process

1. Disadvantages:

• ❌ Other heirs can refuse
• ❌ You must pay (deferred, not free)
• ❌ Can cause family conflicts
• ❌ Risk of insolvency (if you cannot pay)

1. Practical Steps:

• Draw up a will
• Consult a notary
• Negotiate with the heirs
• Draw up a repayment plan

1. Smart Planning:

• Make sure there is a will
• Negotiate early
• Build up a financial buffer
• Seek legal advice

Golden Rule: the surviving child's share is EXCELLENT if you can afford to pay and the other heirs agree. WARNING: make sure you do not put yourself at risk of insolvency!

Next Step

Are you a parent or heir involved in a surviving child's share situation?

1. Speak to a notary
2. Negotiate with the family
3. Check the will
4. Prepare a repayment plan
5. Seek legal assistance if needed

Good luck!